Tokyo fails to set agenda ; bilateral trade talks loom with Washington

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The Asahi Shimbun | 19 April 2017

Tokyo fails to set agenda ; bilateral trade talks loom with Washington

Despite months of maneuvers and negotiations, Japanese bureaucrats failed in their strategy to establish the agenda for the first economic framework talks with the U.S. Trump administration.

About the only agreement reached in the April 18 talks in Tokyo between visiting U.S. Vice President Mike Pence and Deputy Prime Minister Taro Aso was to hold a second round of talks before the end of the year.

The Japanese side started its agenda-setting moves following the February meeting between U.S. President Donald Trump and Prime Minister Shinzo Abe. During that summit, an agreement was reached to have Aso and Pence set up a separate forum for economic dialogue.

Japan pushed for that arrangement to minimize the involvement of Trump, who has consistently stressed a protectionist economic policy with his “America First” stance.

In the following months, Japanese bureaucrats from several ministries, including foreign affairs, finance and infrastructure, tried to persuade their U.S. counterparts to focus on trade and investment rules that would eventually cover the entire Asian region.

In the background to that strategy was the intention of establishing, in some form, provisions laid out in the Trans-Pacific Partnership trade arrangement.

However, U.S. officials instead ended up calling for bilateral trade negotiations as the main item on the agenda for the talks between Pence and Aso. Moreover, the U.S. vice president himself clearly repeated the U.S. stance that the TPP was “a thing of the past for the United States.”

During a joint news conference on April 18 after his meeting with Aso, Pence also indicated that in the future the United States might “commence formal negotiations for a free-trade agreement” with Japan.

In addition, Tokyo was caught off-guard by Washington’s last-minute decision to have Commerce Secretary Wilbur Ross visit Japan and hold talks with Hiroshige Seko, the trade minister, a few hours before the Aso-Pence meeting.

While Japanese officials stressed that the economic framework talks were to be handled by Aso and Pence, U.S. government officials considered the Ross-Seko meeting as part of the negotiation package, in part because Ross is one of Trump’s closest friends in the administration.

The developments led Japanese officials to admit that all their preparations to set the agenda on Tokyo’s terms had failed.

It remains to be seen what, if any, progress can be made in future talks between lower-level officials.

A U.S. government source said real progress would likely not be seen until the latter half of this year.

But if Washington does obtain the upper hand in setting the agenda for those discussions, Tokyo may face the prospect of tough trade negotiations, primarily over automobiles and farm products.

Although Aso and Pence will likely hold a second round of talks this year, Ross and Seko also agreed to meet again in June.

That raises the possibility that trade talks could proceed along a second path aside from the economic dialogue between Aso and Pence.